RFS comes to Club World! Good news for most 2-4-1 holders, ‘neutral to bad’ for others (Part 2)

This is the second part of our article about the extension of Reward Flight Saver to long haul Club World and World Traveller Plus Avios redemptions on British Airways.

Part 1 is here. In summary:

• it is good news to MOST (not all) destinations if you have a new-style British Airways American Express 2-4-1 voucher AND a substantial pile of Avios

• it is broadly neutral if you have a new-style British Airways American Express 2-4-1 voucher and only just earned enough Avios to book flights under the old pricing system (and for some destinations, it it worse)

• it is broadly neutral if you do not have a British Airways American Express 2-4-1 voucher (and for some destinations, it is worse)

• it is bad news if you have an old-style British Airways American Express 2-4-1 voucher and have a low Avios balance, since you are forced into using the ‘more Avios and less cash’ option – you are not given a choice

Under no scenario can these changes be seen as a big win for all members in all circumstances.

How has long haul Avios pricing changed today?

The easiest way to explain the impact of Reward Flight Saver on long haul Business Class and Premium Economy redemptions is by giving you a few examples.

These examples are all based on Club World, but the changes impacts World Traveller Plus too, as well as routes where it wasn’t already available in Economy.

New York

The ‘headline’ price for a return off-peak Club World flight to New York is now 160,000 Avios plus exactly £350.

In reality, you can choose between:

• 160,000 Avios + £350
• 130,000 Avios + £640
• 100,000 Avios + £850
• 88,000 Avios + £1,240
• 64,000 Avios + £1,480
• 50,000 Avios + £1,790

Yesterday, you had the following options:

• 100,000 Avios + £853
• 90,000 Avios + £1,093
• 75,000 Avios + £1,363
• 65,000 Avios + £1,593
• 57,500 Avios + £1,693
• 50,000 Avios + £1,793

Which is best value here?

I have a rough and ready method of picking the ‘best’ Avios and cash mix, and that is to assume that an Avios is worth 1p.

If you DON’T use a 2-4-1 voucher:

Let’s look at the New York numbers again in that context. Firstly, let’s assume that you DON’T have a 2-4-1 voucher and you value an Avios at 1p:

New pricing for one person (Club World):

• 160,000 Avios + £350 = £1,950 implied cost
• 130,000 Avios + £640 = £1,940
• 100,000 Avios + £850 = £1,850
• 88,000 Avios + £1,240 = £2,120
• 64,000 Avios + £1,480 = £2,120
• 50,000 Avios + £1,790 = £2,290

Old pricing for one person (Club World):

• 100,000 Avios + £853 = £1,853
• 90,000 Avios + £1,093 = £1,993
• 75,000 Avios + £1,363 = £2,113
• 65,000 Avios + £1,593 = £2,243
• 57,500 Avios + £1,693 = £2,269
• 50,000 Avios + £1,793 = £2,293

As you can see, virtually nothing has changed.

The ‘Avios rich but cash poor’ benefit from being able to use more Avios and less money. However, the marginal cost of being able to do that is poor. You ‘save’ £500 in taxes by using 60,000 extra Avios – not a deal I would personally make.

For everyone else it is the same. Booking yesterday with a pot of 100,000 Avios required £853 of taxes and charges, and today it requires £850.

Of course, unless you need the flexibility that comes from an Avios ticket being refundable, none of these options offer great value versus a sale cash ticket to be honest.

If you DO have a 2-4-1 voucher:

Now let’s do it again assuming that you DO have a 2-4-1 voucher and that you value an Avios at 1p.

New pricing (1 x Avios @ 1p, 2 x taxes) for two people on a 2-4-1 in Club World:

• 160,000 Avios + £350×2 = £2,300 (£1,150 each)
• 130,000 Avios + £640×2 = £2,580 (£1,290 each)
• 100,000 Avios + £850×2 = £2,700 (£1,350 each)
• 88,000 Avios + £1,240×2 = £3,360 (£1,680 each)
• 64,000 Avios + £1,480×2 = £3,600 (£1,800 each)
• 50,000 Avios + £1,790×2 = £4,080 (£2,040 each)

Old pricing (1 x Avios @ 1p, 2 x taxes) for two people on a 2-4-1 in Club World:

• 100,000 Avios + £853×2 = £2,706 (£1,353 each)
• 90,000 Avios + £1,093×2 = £3,086 (£1,543 each)
• 75,000 Avios + £1,363×2 = £3,476 (£1,738 each)
• 65,000 Avios + £1,593×2 = £3,836 (£1,918 each)
• 57,500 Avios + £1,693×2 = £3,961 (£1,980 each)
• 50,000 Avios + £1,793×2 = £4,086 (£2,043 each)

It is clearly good news IF you have an American Express 2-4-1 voucher to burn AND you have 160,000 Avios to make the booking. Your booking has got around 15% cheaper when you look at the combined cash and Avios required.

If you only have 100,000 Avios in your account, nothing changes. You’re no better and you’re no worse off. Your 2-4-1 booking will still cost you £850 each in taxes and charges, plus 100,000 Avios.

I should also note that you will only see the sliding scale of pricing if you have a ‘new style’ (issued after 1st September 2021) companion voucher. Old-style vouchers will ONLY see the headline redemption price, so 160,000 Avios + £350 in this case.

Dubai

The ‘headline’ price for a return off-peak Club World flight to Dubai is also now 160,000 Avios plus exactly £350.

In reality, you can choose between:

• 160,000 Avios + £350
• 130,000 Avios + £640
• 100,000 Avios + £850
• 88,000 Avios + £1,240
• 64,000 Avios + £1,480
• 50,000 Avios + £1,790

Yesterday, you had the following options:

• 100,000 Avios + £853
• 90,000 Avios + £1,093
• 75,000 Avios + £1,363
• 65,000 Avios + £1,593
• 57,500 Avios + £1,693
• 50,000 Avios + £1,793

Again …. the ‘old’ pricing is still there (100,000 Avios + £850ish) but you now have the option to save £500 by using 60,000 extra Avios.

It’s not necessarily worthwhile doing this, as you’re getting well under our target 1p per Avios on a marginal basis, but the option is there.

With a 2-4-1 voucher, you get similar results to the New York example. If you are Avios rich then you will make a saving by using the maximum possible level, in this case 160,000 Avios. If you only have 100,000 Avios then you are no better off than you were yesterday.

Los Angeles

The ‘headline’ price for a return off-peak Club World flight to Los Angeles is now 180,000 Avios plus exactly £450.

In reality, you can choose between:

• 180,000 Avios + £450
• 152,000 Avios + £680
• 125,000 Avios + £840
• 108,000 Avios + £1,300
• 90,000 Avios + £1,700
• 62,500 Avios + £2,000

Yesterday, you had the following options:

• 125,000 Avios + £853
• 112,500 Avios + £1,143
• 93,800 Avios + £1,473
• 75,000 Avios + £1,793
• 70,000 Avios + £1,923
• 62,500 Avios + £2,023

Again, the ‘old’ level of 125,000 Avios + £850 is still there if you want it.

You have the option of using 55,000 more Avios (total 180,000) to save £390 of taxes and charges. I really wouldn’t do that.

With a 2-4-1 voucher, you ARE better off by taking the 180,000 Avios option if you can (total of 180,000 Avios + £900 for two people) – but do you have 180,000 Avios to burn?

Barbados

The ‘headline’ price for a return off-peak Club World flight to Barbados is also now 180,000 Avios plus exactly £450.

In reality, you can choose between:

• 180,000 Avios + £450
• 152,000 Avios + £680
• 125,000 Avios + £840
• 108,000 Avios + £1,300
• 90,000 Avios + £1,700
• 62,500 Avios + £2,000

Yesterday, you had the following options:

• 125,000 Avios + £718
• 112,500 Avios + £1,008
• 93,800 Avios + £1,338
• 75,000 Avios + £1,658
• 70,000 Avios + £1,788
• 62,500 Avios + £1,888

This is more interesting. The introduction of RFS is a clear devaluation to Barbados even if you have a 2-4-1 voucher and even if you use the new maximum of 180,000 Avios.

Yesterday …. 125,000 Avios + £718.

Today …. 125,000 Avios + £840.

You’ve been legged over.

This next bit is important. You are still worse off even if you are using a 2-4-1 voucher.

Yesterday …. 125,000 Avios + £1,436 (total implied cost of £2,686 at 1p per Avios)

Today …. 180,000 Avios + £900 (total implied cost of £2,700 at 1p per Avios)

If you don’t have 180,000 Avios then you are VERY much worse off.

Yesterday …. 125,000 Avios + £1,436 for two people.

Today …. 125,000 Avios + £1,680 for people.

Two things to ponder …..

BA continues to misunderstand how redemption prices are perceived

This isn’t the first time I have written this, but it bears repeating.

Offering ‘more Avios, less cash’ is fine but should not be your headline message. It risks making the whole Avios scheme look out of reach for the majority of collectors.

Let’s look at Reward Flight Saver to Amsterdam for a return Economy flight:

BA thinks that this is really cool – just £1 of charges, plus 18,500 Avios. My best guess is that your average casual Avios collector looks at this and goes ‘WTF?’.

After all, a discount Economy one-way flight to Amsterdam earns just 125 Avios if you have no BA status.

You need to take 144 one way flights to Amsterdam to get one free return flight (well, with £1 of charges).

Is this really meant to make the Avios scheme look attractive?

Similarly, with this new pricing, British Airways feels that 160,000 Avios + £350 is a more attractive headline price than 100,000 Avios + taxes and charges for a Business Class flight to New York. I disagree. I think it makes the programme look out of reach for the majority of collectors.

The problem with one-way flights from North America has gone away

Potentially the biggest benefit from the changes today is one that most people won’t immediately spot.

The taxes and charges on a one-way Avios long-haul redemption are now half of the taxes of a return.

Whilst this was roughly always the case when flying east, once you adjust for UK Air Passenger Duty, it absolutely was not the case when flying to/from North America.

You will no longer pay a premium if you book your outbound and return flights to North America as 2 x one-way tickets rather than a return. This also makes it easier to mix and match carriers (perhaps one-way on Virgin Atlantic, one way on British Airways, or take a low cost carrier outbound on a day flight and use BA for a flat bed Avios redemption on the overnight back).

Conclusion

Based on my initial look – and I may refine my view in time – the simple conclusion to draw today is:

• long-haul Business / Premium Economy Avios redemptions are now better value if you are using an American Express 241 companion voucher – but not on all routes (see Barbados) and ONLY if you are prepared to use the higher amount of Avios

• long-haul Business / Premium Economy Avios redemptions are the same value – no better and no worse, in most cases – if you do not have an American Express 2-4-1 voucher or do not have enough Avios to take advantage of the new maximum Avios redemption levels

• you may benefit from the taxes and charges figure being equalised in both directions if you ever book one-way flights from North America to the UK

We will clearly be returning to this topic, but I think there is enough here to be getting on with.

Be very clear, however, that this is NOT ‘good news for everyone’. In some cases it is ‘bad news for everyone’ as the Barbados example shows.

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How to earn Avios from UK credit cards (April 2024)

As a reminder, there are various ways of earning Avios points from UK credit cards.  Many cards also have generous sign-up bonuses!

In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

There are two official British Airways American Express cards with attractive sign-up bonuses:

You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points. These points convert at 1:1 into Avios.

Run your own business?

We recommend Capital on Tap for limited companies. You earn 1 Avios per £1 which is impressive for a Visa card, along with a sign-up bonus worth 10,500 Avios.

SPECIAL OFFER: Until 12th May 2024, the Capital on Tap Business Rewards Visa card is offering a bonus of 30,000 points, convertible into 30,000 Avios. You must have a Limited Company to apply. Click here to learn more and click here to apply.

You should also consider the British Airways Accelerating Business credit card. This is open to sole traders as well as limited companies and has a 30,000 Avios sign-up bonus.

There are also generous bonuses on the two American Express Business cards, with the points converting at 1:1 into Avios. These cards are open to sole traders as well as limited companies.

Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.